* Long-range forecasts for drugs a central plank of defence
* Vyvanse for binge eating, new eye drug among highlights
* Deals could push 2020 sales "way north" of $10 bln -CEO
* Credit Suisse analysts currently peg 2020 sales at $8 bln
* $46 bln offer from AbbVie rejected as undervaluing group (Adds closing shares, Breakingviews link)
By Ben Hirschler
LONDON, June 23 (Reuters) - Shire flagged the promise of existing and new drugs on Monday as evidence that AbbVie's $46 billion offer undervalued the company, the latest British firm to be targeted by a U.S. group seeking lower taxes.
Shire is taking a leaf out of AstraZeneca's playbook by disclosing long-range internal forecasts - a tactic used successfully by its larger London-listed rival in fending off a $118 billion bid from Pfizer.
Chief Executive Flemming Ornskov said on Monday that current products would generate sales of at least $7 billion by 2020, with $3 billion more coming from drugs still in the pipeline.
Shire also said that in the medium term it expected sales of $6.5 billion by 2016. The company, best known for hyperactivity and rare-disease drugs, had said on Friday it was aiming to more than double sales to $10 billion by 2020 without giving details.
Ornskov told Reuters that actual sales could be far above $10 billion, since the long-term forecasts did not include revenue from future deal-making or from two recent transactions.
"M&A will clearly add growth to the profile," he said in an interview, noting that the London-listed company had done six deals since he took over 13 months ago. "If I included that in the upside it would be way north of $10 billion."
Shire is a serial acquirer, buying rare disease specialist Viropharma for $4.2 billion last November in its biggest deal yet - and Ornskov said further "large" deals were possible.
As with AstraZeneca's earlier upbeat long-term forecasts, many industry analysts view Shire's $10 billion sales prediction as optimistic, with Credit Suisse saying its own estimates suggested sales of around $8 billion by 2020.
Nonetheless, the confident performance may encourage AbbVie to dig deeper after the two companies confirmed a series of approaches following a Reuters report last week.
Analysts at Jefferies estimated the U.S. company could make the deal pay at a price of up to 55 pounds a share, or $55 billion, against AbbVie's most recent rejected cash-and-shares offer on May 30 of just over 46 pounds.
Shares in Shire, which hit a all-time high on Friday, ended 1.6 percent lower at 43.03 pounds.
Key drugs that Ornskov expects to drive continued strong growth include its best-selling hyperactivity medicine Vyvanse, which is now also being tested as a treatment for binge eating, as well as a much-anticipated drug for dry eye disease called lifitegrast, which it sees as a potential $1 billion-plus seller.
Shire is famous for drugs to treat children with attention deficit hyperactivity disorder but Ornskov said it had become "more and more a rare disease company". The market had yet to catch up fully with the rapid growth and high margins this shift implied, he argued, pointing to the 99 percent total shareholder return achieved since he took over last May.
Shire's strategy copies AstraZeneca's in another way, too, by highlighting the execution risks associated with AbbVie's plan to cut its tax bill through redomiciling in Britain for tax purposes - an industry-wide ploy that has sparked growing political concerns.
Such so-called "inversions" by U.S. companies have moved centre-stage in the pharmaceuticals sector this year, with those firms still paying high tax rates anxious to strike deals that will help them compete with rivals now enjoying lower taxes.
Whether Shire, long viewed as a likely takeover target, escapes the clutches of a larger predator is uncertain and the company is widely seen as more vulnerable to a takeover by AbbVie - or another company - than AstraZeneca.
That reflects both its smaller size, which makes it a more manageable target for a wider range of players, and the lack of attendant political issues in Britain, where the company has a relatively small workforce.
Although established in Britain in 1986 and listed in London, Shire conducts most of its business in the United States and has been resident in Ireland for tax purposes since 2008.
Other companies that industry sources say have looked at Shire in the past include Allergan, itself the target of a takeover approach by Valeant. Banking sources suggest Shire could also appeal to groups such as Bristol-Myers Squibb and Gilead Sciences.
Ornskov declined to comment on whether Shire had received approaches from companies other than AbbVie.
One senior banker described Shire as a "valued inversion target" but he stressed that potential bidders still needed to demonstrate a tie-up also made strategic sense.
For AbbVie CEO Richard Gonzalez, Shire fits the bill in one important respect: it offers a way to reduce his firm's over-reliance on rheumatoid arthritis drug Humira, the world's top-selling medicine, which accounted for 58 percent of the company's sales in the first quarter but which loses U.S. patent protection in late 2016.
AbbVie itself raised in 2014 profit forecast on Monday, citing strong recent business performance. ($1 = 0.5876 British Pounds) (Editing by Tom Pfeiffer, Erica Billingham and David Evans)